Indiana Sports Betting Regs Could Allow Gambling On The Oscars

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Indiana’s sports betting law is one of the more industry-friendly laws out there, and early this week the Indiana Gaming Commission released draft regulations for fleshing out how the industry will run and be overseen by the state.

Much of the 26-page document is relatively standard among states regulating both online/mobile and brick-and-mortar sportsbooks. However, certain proposed regs do stand out.

Under the law signed by the governor in May, the IGC was authorized to permit wagers on “other events,” or non-sporting events. The draft regulations spell out how the industry would need to submit approval for taking bets on something like the Oscars, which New Jersey allowed its books to do earlier this year.

In many ways, and this just being one of them, Indiana is following NJ’s lead on sports wagering. The NJ books had to deal with a minor controversy with regard to wagering on this past February’s Academy Awards, as the internet was abuzz with alleged insider information on who was going to win Best Director. The information that suggested a heavy underdog was going to win, which was disseminated by an offshore, illegal sportsbook, turned out to be false (no surprise there), but it did call into question the future of betting on the Oscars.

Indiana is going to play it by ear.

Under the draft Indiana regs, regulators could allow betting on the Oscars, for example, only if a sportsbook requests it. The book must provide a “full description of the event,” as well as detailed information on “any technology which would be utilized to offer the event.”

Additionally, the books would need to convince regulators that the outcome can be “generated by a reliable and independent process.” The IGC would have power to approve or reject the types of wagers, such as props, on non-sporting events.

Despite possibly allowing bets on awards shows, Indiana will not allow any bets on eSports, which some states do allow.

Here’s a look at some other noteworthy items from the draft regulations, which are expected to be finalized ahead of a September opening of the state’s first b&m sportsbooks.

Undermining the black market

In another regulatory shoutout to New Jersey, the IGC will be tough on companies that do business with offshore sportsbooks, platforms that will take business away from licensed and tax-paying sportsbooks in the Hoosier State. The idea here is to craft regulations that undermine those illicit books, rather than launch an expensive law enforcement effort to shut them down.

From the draft regs: “When determining whether an applicant, certificate holder, vendor licensee, supplier licensee, sports wagering service provider licensee, or sports wagering registrant is suitable for licensure or certification in Indiana, the commission will consider whether or not [the entity]conducts business in prohibited jurisdictions, including but not limited to countries embargoed and sanctioned by the United States, or with known black market operations.”

Affiliates are required to register with the IGC. Some affiliates in the sports betting industry do business with illegal sportsbooks. The IGC may elect to prohibit them from the state.

Server location/monitoring

In order to comply with federal law, the servers for online/mobile sports wagering in Indiana must be within state borders. For example, if Indiana allowed one of its sportsbooks to have its servers in Nevada, the state and operator could fall into hot water. Other states follow this model.

Under the Indiana regs, these servers would need 24-hour surveillance, including “adequate” on-the-ground security. The IGC isn’t messing around with regard to protecting its new sports betting industry. All legal sports bets from Indiana operators must occur within state borders. Books must have their geolocation tested before they can launch.

Sorry, pro sports bettors

It comes as little surprise that the Indiana regulations give operators broad discretion in limiting their liability to losses, or even limiting their exposure to gamblers who win more than they lose.

Under the “house rules” section, the IGC gives operators the ability to limit the wagering amount without the requirement of providing a reason for doing so. Arguably the most legitimate criticism of the NJ sports betting industry is that bettors are being shut out of betting beyond relatively small amounts. The anecdotes suggest that the bettors facing restrictions are sharps.

It’s worth noting that the Indiana regs state explicitly that a sportsbook cannot reduce a maximum payout after the wager was accepted. If this was permitted, the sports betting industry would be junk and consumers would always be vulnerable to being ripped off.

Related to this, the IGC regs state that if somehow a person who is excluded or prohibited from sports wagering is able to place a wager, the sportsbook must still honor that wager. This is a good consumer protection measure.

Geofencing a sports stadium?

The IGC could allow a “sports governing body” to request that the location of a particular sporting event is off-limits for wagering. Regulators would only do so if the sports league demonstrates a “credible threat to the integrity of sports wagering at the particular location of the sporting event which is beyond the control of the sports governing body to preemptively remedy or mitigate.”

The Indiana sports betting law did not give the leagues a handout in the form of mandating that operators use league data for determining the outcome of wagers.

The league(s) would have to also convince regulators that “no other means exist to remedy or mitigate the specific risk to sports wagering at the location of the particular sporting event and that geofencing is the only appropriate measure to address the issue.”

The burden here is on the leagues, as the IGC could consult with an “independent monitoring provider” and other sports betting states in deciding whether to grant the request.

Sports betting platform not like a poker site

Unfortunately for bettors, the IGC will not allow you to transfer or receive money from someone else’s online/mobile sports betting account.

Let’s say you’re at a bar with your friends, and you don’t currently have the funds to place a bet. While there could be a case made that you shouldn’t be betting in the first place, you won’t be able to turn to your friend and ask if they can send you funds on the app to make your bet. Fortunately, there will be plenty of deposit options available to customers.

Of course, if kickoff is just moments away and you realize you have nothing in your account, the quickest way to get money may be to ask your friend to transfer some to you on the sports betting app. The reg prohibiting this hypothetical scenario makes it so sports bettors will have to plan slightly better and have the means to fund their account with some time to spare ahead of the event.

Dormant accounts

The IGC is pretty consumer-friendly with regard to how long an operator must to wait to close your online/mobile account due to inactivity. A sportsbook can only consider your account to be dormant if you haven’t logged on for “at least” three years. The book can then close your account.

The funds you have in their will be considered “abandoned,” and they will head to the state only after the book sends a notice to your last known address. This regulation won’t be relevant for quite some time, but it’s easy to see that one day Indiana may be collecting money from some sports bettors who stopped playing or switched which book(s) they gamble with.

Three years is a long time. Any sports bettor who forgot about their account and their money for that long probably won’t be missing it too much if the state claims it.

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Brian Pempus

Brian served as a senior reporter and online content manager for Card Player Magazine for nearly a decade before joining USBets in October 2018. He is currently focused on legal and regulated sports betting and online gaming. He's an avid jiu-jitsu practitioner in his free time.

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